Compliance Blog - R.J. Hedges & Associates

Did you hear that Competitive Bidding is being eliminated and everyone can start doing DME again? While it’s not being totally eliminated, Competitive Bidding will be suspended nationwide from 1/1/2019-12/31-2020, while a new program is being prepared. Many pharmacies will be able to start dispensing things previously deemed ineligible if the pharmacy was in one of those competitive bidding zones.

Another date to pencil in, is 01/01/2020. As this is when the CURES Act will go into full force, which requires all state Medicaid programs to follow all Medicare requirements, including fee schedules and possibly accreditation.

Now, what’s the big deal here? If Competitive Bid is suspended how will that actually help Pharmacies and DME facilities that are listening to us today?

Pharmacies, especially pharmacies in those 99 Competitive Bid Zones have been locked out of a lot of different products. There’s are only 10 items, but they are 10 big items. Starting January 1, 2019 pharmacies can start dispensing these products. AND even though the fee for product will not change initially, it does appear that the reimbursements are going to go “UP”!

What’s the first thing a pharmacy needs to do if they wish to jump on the band wagon and take advantage of this rule suspension?

First the facilities and pharmacies need to know the status of their PTAN with the National Supplier Clearinghouse (NSC). So, do you have a Medicare Part B PTAN, and is it active or exempt?

Everyone will fall into one of four bins: Exempt Pharmacies, Accredited facilities, Pharmacies with a pharmaceutical PTAN only, and then everyone else will falls into the last bin. Most pharmacies are going to be in the first two groups, either Exempt or Accredited. In the end those with a PTAN will have an easier time bringing on more DMEPOS products to their pharmacy for their patients, while those without a PTAN, those in the last bin, will have a lot of work ahead of them as they will need to start from scratch.

No matter which bin you fall into, look at your current DMEPOS products, and determine if you wish to add additional products. Once you check the acquisition costs and the current fee schedule for reimbursements to ensure the product is profitable- if need be start doing those additional trainings and complete the necessary licensing requirements now. If the pharmacy is exempt, add the items with support documentation to the CMS 855S application now. If the pharmacy is accredited, contact your accreditation organization to find out whether you will need to be surveyed for these products and if there is a fee to add them now.

Becky: You may have heard that Competitive Bidding is being eliminated and everyone can start doing DME again. Yea!!! Well, that’s only partially true. While it’s not being totally eliminated, Competitive Bidding will be suspended nationwide, while a new program is being prepared. So mark your calendars from 01/01/2019 (boy, that’s going to be here before we know it) all the way through the end of 2020. Many of you may be able to start dispensing things that you weren’t able to before because you found yourself in one of those competitive bidding zones. Another date to pencil in, is 01/01/2020. Why’s that important? Well, the CURES Act will go into full force, which requires all state Medicaid programs to follow all Medicare requirements, including fee schedules and possibly accreditation. But, don’t worry folks, we promise to share any information just as soon as it comes to us, so please stay tuned! Now, today, we are going to talk about the “Suspension of Competitive Bid and what that means to you and your Pharmacy or DME Facility”. Joining us today is the man, the legend, the HIPAA Guy, the Pharmacy Compliance Guide, and my Boss, Mr. Jeff Hedges to help educate, encourage and map out a plan for capitalizing on this rule shift. So Jeff, thanks for joining us today.

Jeff: Glad to be back and finally have a positive podcast- there’s light out there for all of our pharmacy owners!

Becky: Now, what’s the big deal here? If Competitive Bid is suspended how will that actually help Pharmacies and DME facilities that are listening to us today?

Jeff: Pharmacies, especially pharmacies in those 99 Competitive Bid Zones have been locked out of a lot of different products. There’s quote only 10 items, but they are 10 big items. Now on January 1, you can start dispensing these products to help grow your business, it can increase your sales because they are going to come in and get your DME products that you haven’t been able to do that will support your current prescriptions and it can also bring new business in. AND even though the fee for product will not change initially, it does appear that the reimbursements are going to go “UP”! Yes, you heard me correctly, reimbursements are scheduled to go up for DMEPOS products sometime in 2019!

Becky: I don’t even know the last time we had a conversation where pharmacies were going to start getting paid more- but I bet that just perked up a whole lot of little ears out there. So Jeff, what’s the first thing a pharmacy needs to do if they wish to jump on the band wagon and take advantage of this rule suspension?

Jeff: Well first the facilities and pharmacies need to know the status of their PTAN with the National Supplier Clearinghouse (NSC). So, do you have a Medicare Part B PTAN, and is it active or exempt?

Becky: Why is that Part B PTAN so important?

Jeff: Everyone will fall into one of four bins: Exempt Pharmacies, Accredited facilities, Pharmacies with a pharmaceutical PTAN only, and then everyone else will falls into the last bin. Most pharmacies are going to be in the first two groups, either Exempt or Accredited. In the end those with a PTAN will have an easier time bringing on more DMEPOS products to their pharmacy for their patients, while those without a PTAN, those in the last bin, will have a lot of work ahead of them as they will need to start from scratch.

Becky: Before we get too deep into this process, can you tell us a little about each of the Bins?

Jeff: Sure, Bin #1 is Exempt Pharmacies. These are pharmacies who were either grandfathered into this program a long time ago, OR were accredited for at least 5 years with the billing 5% or less of total sales of DME compared to their pharmaceuticals. The “exemption” only exempts the pharmacy from going through the accreditation process- it does NOT exempt people from the actual rules of dispensing. All the paperwork still needs to be done. We’ve talked to tons of people who think they are exempt from the rules, they are exempt from accreditation requirements. Remember, if you have achieved exemption status you still need to have a DME compliance program in place and follow all the rules set forth by CMS in the supplier manuals.

Becky: How will an Exempt Pharmacy move forward if they wish to add more products to their current offerings?

Jeff: This is an exciting bin, especially those located in a competitive bid area as they’re able to diversify to a lot of different products. In fact, all items are available for Exempt Pharmacies to dispense starting January 1st, 2019. I would recommend these locations, look at the items they wish to dispense, then check the NSC’s licensure database on their website to see what specific training requirements maybe required for the devices selected. If need be, you should obtain any licenses, and get extra training, including any manufacturer training now. To bill Medicare starting January 1st, all they need to do is submit an updated CMS 855S application and include Section 3D with all the products they wish to dispense.

Becky: Well that’s a pretty easy process! What’s the next bin facilities can fall into?

Jeff: Bin #2 is home to Accredited Pharmacies and DMEPOS Facilities. These are facilities that are currently accredited by one of the 9 Accreditation Organizations. This is also a great bin as these facilities they can add any and all items they wish to dispense just like our exempt pharmacies. The big difference is, they will need to contact their Accreditation Organization and have this added to their certificates. Please know there may be a small fee and they may require another on-site survey depending on the items selected. Now it is possible for pharmacies in this bin to become Exempt if they meet the requirements like those pharmacies in Bin #1. They just need to file out the exemption paperwork, send it to NSC, and in 30 days you will have the exemption and now you are in the #1 bin. But beware- they need to check with their state Medicaid and Insurance companies to ensure accreditation is not a requirement to participate. If it is, then they do NOT want to move to the exemption. If it is not a requirement, fill out the form and save a few thousand dollars every few years.

Becky: So to clarify- Pharmacies and DME facilities that are currently accredited will still need to obtain extra licenses and get trainings based on the new products they wish to dispense?

Jeff: Correct

Becky: Then they would also need to complete Section 3D of their CMS 855S and submit that to Medicare as well?

Jeff: Correct Again!

Becky: Ok perfect, so what are the other two bins we need to know about?

Jeff: The 3rd Bin is for our Pharmacies with a Pharmaceutical PTAN only. These are the pharmacies that never have been accredited or dispensed DMEPOS items before, but have completed a CMS855s for Non Accredited Drugs. The good news is, if they wish to enter the DMEPOS market they’ve already done the thing that takes the most time- and that is getting your PTAN. The bad news, they must get accredited. But they’ve already got a leg up on our next bin of facilities, because depending on what items they want to dispense and what their current compliance programs look like, they may be able to get your accreditation within 45 days.

Becky: Well that’s not too bad, who’s in that very last bin?

Jeff: In our 4th and final bin… is everyone else- that’s right all the other Pharmacies and DME facilities out there. So, if facilities are entering the market for the first time, it can take up to a full year to get all of the paperwork in place, apply and get awarded an accreditation certificate and finally have a PTAN awarded all before they can even dispense or bill an item or collect revenue from any Medicare patients.

Becky: So it sounds like facilities that are exempt are sitting pretty and have the easiest path in front of them to add more products to their stores. Whereas the folks who don’t have anything in place right now it’s going to take them quite a long time to get set up.

Jeff: That’s right.

Becky: Hey Jeff, if our listeners know which category their pharmacy falls under, should they wait till January 1st to get started?

Jeff: Absolutely not! No matter which bin you fall into, look at your current DMEPOS products, and determine if you wish to add additional products. Once you check the acquisition costs and the current fee schedule for reimbursements to ensure the product is profitable- if need be start doing those additional trainings and complete the necessary licensing requirements now. If the pharmacy is exempt, add the items with support documentation to the CMS 855S application now. If the pharmacy is accredited, contact your accreditation organization to find out whether you will need to be surveyed for these products and if there is a fee to add them now.

Becky: Well, you all heard the man, get started now! Thank you so much for clarifying how the Competitive Bidding suspension can help pharmacies and DME facilities and helping to map out the necessary steps they need to move forward if they want to add new product to their stores. Folks, if you are already an R.J. Hedges & Associates client, go you, thank you so much. Go ahead and reach out to your Project Manager, she’ll be more than happy to get you pointed in the right direction and can complete many of these items for you. That’s right, all those dreaded forms they can actually help you with many of them. Now for the rest of you, if you are excited about adding products (yeah), but the thought of completing a Medicare Application has you depressed (boo), or if you are pumped to increase revenue to your store but deflated at the idea of writing all those policies and procedures to make the accreditation organizations and Medicare happy… Have no fear- R.J. Hedges & Associates is here and they have services to help with everything we talked about today. Not only can they complete the 855S application for DME items and/or Non Accredited Drugs, they can even complete the 855B which is for Immunizations. They have a DMEPOS program that has all the Policies & Procedures to satisfy Medicare and your Accreditation Organization, it has Detailed Written Orders and Written Orders Prior to Delivery for over 50 products complete with the LCD requirements and it’s chock full of helpful resources and checklists to help simplify everything from your accreditation to your CMS visits that will take place in the future. If you’d like more information feel free to reach out to one of our Compliance Strategists to see how we can help you! Now be sure to tune in to the Pharmacy Podcast Network regularly as they are adding new content daily. And stay tuned for our next episode we’re going to continue this topic on Competitive Bidding and dive into the Fee Schedules & How to dispense to help ensure you can make enough money to cover all of your items. Hey, Thanks so much for joining, you guys have a great day!

Becky is a Board Certified DME Specialist and Accredited Business Intermediary. Her education and training background fuels her desire to understand how things work, while trying to get the simplest answers and best methods for implementation. She is the go to woman for R.J. Hedges’ training and the voice of many of our videos.